I have a BMW 2003 325i. I wanted to try and get the rear seats to fold
so that I can transport some luggage. However, I couldnt find any
levers or anything.

I read the manual and it lists the folding seats as an optional item;
if its present, then I should see some levers inside the trunk. I didnt
find any. To make things horrifying, I found a metal sheet behind the
seats which pretty much implies that even if I manage to fold the
seats, its pointless; the trunk space doesnt increase.

So is there anyway to get extra trunk space in my car? How much will an
average BMW dealer charge me to get this option?

You can't add the option, it has to be built in. If you have it, the
mechanism is obvious, if you haven't got it, you'll never have it with this
car. There is nothing preventing you from putting the luggage directly into
the back seat.

You should be able to fit an aftermarket "ski bag" (if it's the same as the
metal not-folding rear seat in my E36 - never even checked before I bought
it) - there's a rectangular panel in the middle of the sheet which can be
punched out (it has reinforcement around it), and the ski bag fits into the
hole. It'll take long thin items (I never got around to actually fitting one
for my snowboard, I ended up just slinging it onto the back seat), and
extends out where the rear seat armrest folds down.

I've occasionally had things like sheets of sheetrock in the back of my
M3 and sometimes when ones golf paraphernalia gets a bit too big it's
nice to have the back seat down, so yes, for me the split folding rear
seats was a must. I don't get any ego boost about them though!